Here is my next post on how to appreciate your employees in a very creative way by enabling them to share in the success of the business, allow for some succession planning of your business and get some tax benefits.
This is an idea that you may not have known much about so go ahead and read on....
One of the many retirement plan options available is that of Stock Bonus Plans. This plan is similar to another plan called Profit Sharing Plan. When you set up your retirement plan for your business you would learn about these various options possible.
This post is about a very interesting type of Stock Bonus Plan called Employee Stock Ownership Plan (ESOP) that offers special tax advantages to the company and great incentives to the employees.
There are research claims out there stating that companies where employees have a stake in the ownership of the company, even if through ESOP, perform much better than those that don’t have employee ownership. ESOP offers a way for owners to involve the employees into the ownership of the company. It also offers liquidity to the owners for their shares.
Most importantly, ESOP offer a very interesting tax planning opportunity for small and medium sized companies.You need to get customized evaluation of your situation to see if an ESOP is a good option for you. If so, you would need to hire the services of a professional firm to help you with the set up. Although, it requires some thought and consideration, still you should not ignore it as it offers a wonderful tax planning opportunity and you are still able to retain the control of your company.
